Use the Table for the Question(s) Below $\text { AOS Industries Statement of Cash Flows for } 2012$

question 23

Multiple Choice

Use the table for the question(s) below.
$\text { AOS Industries Statement of Cash Flows for } 2012$
$\begin{array}{l}\text { Operating activities }\\\text { Net Income } & 3.2 \\\text { Depreciation and amortisation } & 1.4 \\\text { Cash effect of changes in } & \\\text { Accounts receivable } & 2.1 \\\text { Accounts payable } & 1.1 \\\text { Inventory } & 0.8 \\\text { Cash from operating activities } & 2.8 \\\hline\\\text { Investment activities }\\\text { Capital expenditures } & 2.2 \\\text { Acquisitions and other investing activity } & -0.4 \\\text { h from investing activities } & 2.6\\\hline\\\text { Financing activities }\\\text { Dividends paid } & -1.5 \\\text { Sale or purchase of stock } & 2.1 \\\text { Increase in short-term borrowing } & 1.4 \\\text { Increase in long-term borrowing } & 3.2 \\\text { Cash from financing activities } & 5.2 \\\hline \text { Change in Cash and Cash Equivalents } & \mathbf{5 . 4}\end{array}$
-Consider the above statement of cash flows. If all amounts shown above are in millions of dollars, what were AOS Industries' retained earnings for 2012?

• A) $1.7 million
• B) $2.1 million
• C) $5.4 million
• D) $1.3 million

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Definitions:

Shares

Units of ownership interest in a corporation or financial asset that provide for an equal distribution in any profits, if any are declared, in the form of dividends.

Consolidation

The process of combining assets, liabilities, and other financial items of two or more entities into one.

Corporations

Legal entities that are separate from their owners, offering limited liability to its shareholders, and created under corporate law.

Merger

The combination of two or more companies into a single legal entity, often to achieve greater efficiencies of scale and scope.